Let’s think through the key elements step by step. --- **1. Context on hybrid bonds and S&P cap** Hybrid bonds receive partial or full equity credit from rating agencies like S&P, subject to a cap — here 15% of total adjusted capital (debt + equity). To maximize the benefit without breaching the cap, a company should issue up to that 15% limit. --- **2. VINCI’s capital structure at end-2022** - **Equity** (including non-controlling interests): €29,409 million - **Debt**: - Non-current bonds: €20,425 million - Other non-current borrowings: €3,205 million - Short-term borrowings: €6,368 million - Lease liabilities (non-current + current): €1,580 + €522 = €2,102 million - For a quick estimate, total debt ≈ €32,100 million - **Total adjusted capital** (Equity + Debt) ≈ €29.4B + €32.1B ≈ €61.5 billion. 15 % of that ≈ **€9.2 billion**. --- **3. Current hybrid usage** From the given facts, there is no explicit mention of hybrid bonds outstanding. VINCI’s borrowings appear to consist of bonds, bank debt, and leases, without indication of hybrid capital. This means current hybrid utilization is likely **0%** of the cap. --- **4. Rationale for hybrid utilization** VINCI has: - Strong investment-grade profile (implied by its size, stable cash flows, and concession assets). - Significant and recurring cash flow from operations (€9.4B in 2022). - Large infrastructure/concession investments requiring long-term stable funding. - Low current hybrid issuance, so plenty of room under S&P’s 15% limit. Given low interest rates in prior years (though rising in 2022), hybrids would’ve been an attractive, rating-efficient financing tool. From a capital structure optimization perspective, issuing up to the full 15% cap could lower the weighted average cost of capital while preserving credit metrics. --- **5. Conclusion** Given the room under the cap, the nature of its long-term assets, and the benefits of equity credit, VINCI could reasonably target full utilization within S&P’s limit — **100%** of the allowable 15%. --- 100%